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Extra Judicial Settlement of Estate


An extrajudicial settlement of estate is resorted to when all of the following are present:

1. When the decedent left no last will and testament;
2. He had no debts, which shall be presumed if no creditor filed a petition for letters of administration within two years from his death; and
3. All the heirs are of legal age, or the minors are represented by their judicial or legal representatives duly authorized for the purpose.

In an extrajudicial settlement, the legal heirs or their representatives may divide the estate among themselves as they see fit by means of a public instrument filed with the office of the register of deeds without need of securing letters of administration from the court. This is usually resorted to in order to simplify the estate settlement process and avoid the oftentimes tedious and contentious legal proceedings attendant to a judicial estate settlement.  However, for an extrajudicial settlement to prosper, a unanimous agreement among the legal heirs is indispensable.  If the heirs do not agree on how to divide the estate, the case may be up for judicial determination through the filing of an ordinary petition for partition by any or all of the heirs with the proper court.

If there is only one heir, he may adjudicate to himself the entire estate by means of an affidavit of self-adjudication filed with the register of deeds.

A bond is required to be filed with the register of deeds to secure claims of heirs or interested persons which may have been unduly deprived of partiticipation in the distribution of the estate.  The bond and the real estate subject of the above-named public instrument or affidavit shall remain charged with a liability to creditors, heirs, or other persons for the full period of two years after such distribution. This shall be the case, notwithstanding any transfers of real estate that may have been made.

If, the person unduly deprived of participation is a minor, mentally incapacitated, is in prison, or outside the Philippines, he may present his claim within one year from the removal of the disability.

The fact of the extrajudicial settlement or administration  shall be published  in a newspaper of general circulation.

(Rule 74 of the Rules of Court)

Extra Judicial Settlement of Estate
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